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Rival telecom giants team up to buy Leafs

For a shade more than $1.3 billion, multimedia companies Bell and Rogers purchased Dion Phaneuf\'s Maple Leafs and the rest of MLSE\'s sports and business holdings. (Getty Images)
Author: The Hockey News

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Rival telecom giants team up to buy Leafs

We don't want to believe sports is a business. We want to believe the bottom line is winning, not profiting. We want to believe our passion is shared by ownership, not exploited or leveraged for the benefit of corporations.

That's why it was so exciting for Buffalo Sabres fans in February when Terry Pegula was introduced as their new owner. Here was a billionaire buying his favorite team, pledging to end its tight-fisted ways, tearing up talking about Gilbert Perreault, dreaming of Stanley Cups. Yes, Cups, plural.

And that's why it must have been so surreal for Toronto Maple Leafs fans on Friday when executives from Bell and Rogers announced they were buying a 75-percent stake in Maple Leaf Sports and Entertainment. Here were Canada's two largest telecommunications companies – bitter rivals, direct competitors – forging an unusual alliance because of the strength of the "asset," the access to "premium content" for multimedia "platforms," the "perfect fit" from a "strategic perspective."

The executives played up the fact that these are Canadian companies keeping MLSE in Canadian hands. After all, the Leafs call themselves Canada's team and wear the nation's symbol on their sweaters, and American investors had reportedly been poking around. But the patriotism didn't show any loyalty or personalize anything.

Bell said it will keep its 18-percent stake in the Montreal Canadiens. Bell has its name on the home of the Habs, the Bell Centre. Rogers has its name on the home of the Vancouver Canucks, Rogers Arena. And these are now the owners of the Maple Leafs.

George Cope, the president and CEO of Bell Canada, opened his remarks by saying this was an "incredibly exciting day" for his employees, for MLSE management and "most importantly for the fans of MLSE."

But there are no fans of MLSE, of course.

There are fans of the NHL's Maple Leafs, the AHL's Marlies, the NBA's Raptors and MLS' Toronto FC. I guess you can be a fan of an arena or a condo or a TV channel or any of the other stuff MLSE owns. I know I'm a fan of Real Sports, MLSE's sports bar, which is part of MLSE's real-estate development, which is across the street from MLSE's Air Canada Centre, which houses two of MLSE's teams. But that's different.

Fans see themselves as fans, not consumers. They see themselves rooting for teams, not assets or properties or companies or conglomerates. They have two main questions at a time like this: Does this increase my team's chances of winning a championship, and how does this affect how I follow my team?

When it comes to the Maple Leafs, the centerpiece of this deal, the short answer is that this likely does not increase their chances of winning their first Stanley Cup since 1967. It might lead to a better fan experience, but it might cost more. More than anything, this is a reality check – a reminder of what sports really are and how big of a business they can become.

* * * * *

There is no one way to win.

The best way is with a singular owner with resources and commitment. A singular owner gives the team a face – someone to praise, someone to blame. A singular owner can make the pursuit of winning personal and make decisions that are about more than money.

But singular owners also can be aloof, money-grubbing or meddlesome. They can make bad decisions and spend money unwisely. Pegula went on a shopping spree in free agency, but who was smarter? The Sabres, who signed Christian Ehrhoff and Ville Leino to massive contracts? Or the faceless Leafs, who didn't do anything crazy?

The Maple Leafs might never have a singular owner. They have grown too big. Consider that Pegula bought the Sabres for $165 million. The Leafs are the most valuable team in the NHL at $521 million, according to Forbes, and they are part of MLSE, 80 percent of which was just sold for $1.32 billion. Bell and Rogers each spent $533 million for 37.5 percent. MLSE chairman Larry Tanenbaum kicked in the rest to increase his stake from 20.5 to 25 percent. When you're talking billions, you are drastically reducing the number of individuals who have that kind of cash. So you're talking about companies and investment groups.

One theory is that the Leafs have maximized their revenues (except for, you know, making the playoffs). That would be a good reason for the Ontario Teachers' Pension Plan to sell its 80-percent stake now. MLSE's growth potential lies, first and foremost, in how the Leafs can be used to make money in other ways. A singular owner probably isn't in position to do that. A pension plan isn't positioned to do that. But telecommunications companies are positioned to do just that because the Leafs provide content that can be packaged and sold so many different ways – TV, radio, phones, computers, tablets.

The teachers often were criticized for not wanting to win. That was untrue. Of course they wanted to win. And the telecoms will, too.

"It's all about winning," said Nadir Mohamed, president and CEO of Rogers Communications. "It's all about championships. And there's no confusion from that perspective we have a common interest. By the way, championship teams drive our network business."

No matter your ownership structure, winning can help you make more money. No matter your ownership structure, winning depends on whether you hire the right people and give them the resources and time to do their jobs right.

Resources aren't the reason the Leafs haven't made the playoffs since 2004, and they won't be an issue in the future, either. The NHL has a cap on players' salaries. The Leafs can spend to the limit – and even exceed it by burying troublesome contracts in the minors (see Finger, Jeff). There is no cap on executive pay. As I have written before, the Leafs have more GMs than General Motors (see Burke, Brian; Nonis, David; Poulin, Dave; Loiselle, Claude; Dudley, Rick).

The question has been and always will be whether the Leafs have hired the right people and whether they are giving them time to do their jobs right.

In the past, the teachers were criticized for focusing on the short-term balance sheets, pushing to make the playoffs to rake in all that revenue, not sticking to a long-term plan. The pattern continued up to the Phil Kessel deal in September of 2009, as rebuild-on-the-fly Burke traded two first-round draft picks and a second-rounder to the Boston Bruins for one young sniper, as if the Leafs were just a player away.

Lately, the Leafs have shown patience. Burke seems to have re-evaluated the team and has made some smart moves to position it for the future. And maybe nothing will change in terms of how the Leafs are run, for better or for worse.

"Everyone wins when a franchise or any of the organizations win," Cope said, "and these two companies know how to win and will be focused on that with a great MLSE management team going forward."

Cope said it will be "the management of MLSE that will be leading this great asset," and Tanenbaum will remain in charge.

But what has Tanenbaum won so far?

And will the Leafs go right back to being impatient again, only even worse? Bell and Rogers know how to win in terms of traffic and ratings. They will want to win, all right. They will want to win now, now, now in this new media world of instant metrics. Is that best for the long-term planning needed to build a perennial championship contender?

* * * * *

There is the competition between the Leafs and the rest of the NHL. Then there is the competition between Bell and Rogers, who fight for ears and eyeballs from TV to radio to phones to the Internet. Bell is TSN. Rogers is Sportsnet.

This is Coke and Pepsi buying the same soda formula and figuring out how many ways it can sell it to a parched public.

When Cope said he would hand Mohamed the microphone slowly later, Mohamed finally took the mic and said: "I won't make reference to slow networks or anything in terms of the speed of the transfer."

More laughs.

"This could go on I could see for some time."

Leafs fans can only hope he wasn't talking about the playoff or Cup droughts.

This situation seems ripe for infighting on every issue – from how the team is run to how all that premium content is packaged on all those platforms. TSN and Sportsnet reportedly will split the radio rights next season, but the execs were vague about how the TV rights will be divided.

These companies have partnered before. But the 2010 Vancouver Olympics were one thing, a one-time event that lasted a few weeks. This is something else entirely, a multi-headed monster that operates year round and includes one of Canada's crown jewels.

Cope and Mohamed both said this will increase competition, not discourage it. That should be true from an editorial standpoint. TSN and Sportsnet reporters won't be working hand-in-hand. They will be going toe-to-toe.

"For the consumer, it means more choice," Cope said. "We will be racing each other to get this content on our devices faster than the other guy and doing all those type of things, all which drive competitive positioning in the marketplace."

But that was the case already.

The difference is what happens when that content reaches those devices in the future. Bell and Rogers will control all of that content, and they also will control how much they charge for advertising and subscriptions. At least on some level, they will be cooperating from a business standpoint, not competing. They can jack up the prices.

The Competition Bureau of Canada reportedly will review the deal. A spokesperson for the Ottawa-based watchdog told the National Post that part of the bureau's mandate is to determine if this will "result in a substantial lessening or prevention of competition." But I assume Bell and Rogers did their legal homework. Cope and Mohamed shrugged off a question about regulatory concerns.

In the modern age of the DVR, sports programming is the last thing people sit down to watch as it happens. That is incredibly valuable, so valuable that Bell and Rogers were willing to come together to cash in on it – perhaps in fear of a third party coming in and swiping all that business from them both.

"MLSE offers some of the richest, most sought-after content in North America," Mohamed said, "and this investment will secure a long-term access to all of this iconic brand and content."

In other words, this investment will secure a long-term access to the heartstrings and purse strings of Toronto fans – a captive audience in more ways than one.

News

The Coyotes are reportedly looking to move out Anthony Duclair, and that was the case as early as this past summer. Duclair was reportedly part of a trade offer Arizona made for Flames defenseman Dougie Hamilton.

That team, apparently, was the Arizona Coyotes. According to TSN's Darren Dreger, Coyotes GM John Chayka approached Flames GM Brad Treliving around the 2016 NHL Draft with an offer of young winger Anthony Duclair and a draft pick for the 23-year-old Hamilton. Dreger said the talks didn't go very far and doesn't know why this story recently resurfaced, though Burke obviously had enough.

While Burke's comments should put an end to the Hamilton trade chatter for a while, this story should further stoke conjecture over the 21-year-old Duclair's future with the Coyotes. He was thought to be a key part of their rebuilding program, with a respectable 20-goal, 44-point rookie performance last season.

Of late, however, there's talk the Coyotes could entertain offers for Duclair, who's managed only four points in 24 games this season. It was believed they wanted a good young player, preferably a center, as a return. Given their pursuit of Hamilton last summer, a promising blueliner could also fit the bill.

While the Coyotes are reportedly willing to listen to offers for winger Anthony Duclair, LeBrun claims the Senators aren't interested. That's understandable, as the Coyotes apparently seek a good young player who can help them right away. Dorion can't spare that type of player.

Another option could be Boston Bruins forward Ryan Spooner, who can skate at center or on the wing. The Bruins are apparently talking with several clubs. Spooner's $950K salary-cap hit is certainly enticing, plus he had a 49-point campaign in 2015-16. While Dorion's looking for someone to play on his checking lines, Ryan's injury might make him reconsider.

Bruins winger Jimmy Hayes could be another option. Garrioch reported Sunday the Bruins would like to move him, but Dorion could balk at his poor production (one goal in 23 games) and $2.3-million annual cap hit through 2017-18.

Garrioch also reports Edmonton Oilers left wing Benoit Pouliot could be available. He said the Oilers weren't shopping the 30-year-old veteran, but had spoken with several clubs to gauge their interest. He also notes the New York Islanders are trying to move winger Nikolai Kulemin.

A more affordable option could be Toronto Maple Leafs center Peter Holland. With a $1.3-million cap hit for this season, the 25-year-old is reportedly on the trade block. The Sens and Leafs have a recent trade history, so perhaps this could be a move that helps both sides.

Rumor Roundup appears regularly only on thehockeynews.com. Lyle Richardson has been an NHL commentator since 1998 on his website, spectorshockey.net, and is a contributing writer for Eishockey News and The Guardian (P.E.I.).For more great profiles, news and views from the world of hockey, subscribe to The Hockey News magazine.

Blackhawks emergency backup Eric Semborski gets his own rookie card

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Blackhawks emergency backup Eric Semborski gets his own rookie card

Eric Semborski landed himself the opportunity of a lifetime when he strapped on the pads as an emergency backup for the Blackhawks, and now Topps has commemorated the moment with a Semborski trading card.

Eric Semborski’s dream came true when he stepped on the ice as an NHL goaltender, albeit an emergency backup, on Dec. 3, and now he’s got an incredible piece of memorabilia to show for it.

Just days after the 23-year-old made his rookie debut, trading card company Topps has unveiled the official Eric Semborski rookie card. That’s right: the 23-year-old has his very own trading card. The card is part of Topps’ NOW series, which features milestone or memorable moments and are made available shortly after the achievement.

Semborski’s stint as the Blackhawks emergency goaltender came due to regular starting netminder Corey Crawford was sent to hospital to undergo an appendectomy. The Blackhawks were scrambling to find a replacement for Crawford, and a backup for Scott Darling, when they started asking around to find an emergency amateur netminder to fill in.

Semborski, a former goaltender at Temple University, was working with children at the Flyers’ practice facility when he was called to sign on for emergency duty. Hilariously, Semborski wore a Blackhawks No. 50 jersey — which most will recognize as Crawford’s number — when he took the ice for warmup. Of the chance to stop NHL shots in warmup, Semborski said it was the best moment of his life.

Possibly the only thing that could have made the moment better was if Semborski actually got into the game and, as it turns out, that was very nearly the case. Post-game, Blackhawks coach Joel Quenneville said that had the Flyers scored on the empty net to stretch their lead in the Saturday afternoon contest, he would have thrown Semborski into the net for the final minute of the outing.

As for the card, there’s no chance it will be worth anything near what a Connor McDavid rookie card will be worth in a decade, but it’s certainly a nice piece of merchandise for the one-day NHL netminder.

Montreal can't panic over injuries to Galchenyuk and Desharnais

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Montreal can't panic over injuries to Galchenyuk and Desharnais

While the loss of the two centers is a crushing blow in the short-term, this team is positioned too well to lose assets in a hasty trade scenario

The Montreal Canadiens will be without top center Alex Galchenyuk and fellow pivot David Desharnais for at least six weeks, perhaps even eight. Both players sustained knee injuries in recent games and the news is obviously not good. But GM Marc Bergevin would make it even worse by jumping into a hasty trade.

True, the Habs now look skeletal down the middle (though Tomas Plekanec isn't a horrible choice for the top line and Andrew Shaw can help out), but this is a short-term problem. Montreal is the top team in the Eastern Conference right now and with netminder Carey Price, they can win more than a few games in the next month or so just on the strength of his gifted play. And the Shea Weber-led defense has been better than expected, so even if the Habs are super-boring and conservative until February, they'll get some results.

Will Montreal still be on top by then? Maybe not, but as long as they don't lose like, 20 games in a row, they'll still be in a playoff position with enough runway left to climb back up the rungs. And as the Los Angeles Kings have proven twice already, you can win the Stanley Cup as long as you get into the playoffs, particularly if your goalie is one of the best on the planet (caveat: being a great possession team helps and the Canadiens are only middling).

But a trade is not the way to go, particularly since the Canadiens aren't deep to begin with. They don't have many attractive pro prospects right now – unless they can drum up interest in a Charles Hudon or Nikita Scherbak – and their best recent draft pick is defenseman Mikhail Sergachev, who should be seen as untouchable. I mean, if Pittsburgh offers up Evgeni Malkin for the 2016 first-rounder and a couple other goodies, you make that trade – but I don't think that's going to happen.

If anything, Montreal needs to build their pipeline up, instead of taking assets away from it. The Canadiens ranked just 23rd in the NHL in our most recent Future Watch edition and Sergachev was the only pick they made in the first two rounds this summer. They do have two second-rounders for 2017 (their own and Washington's selection), but again: they need those.

Galchenyuk and Desharnais will be back and in all likelihood, the Canadiens will still be in a playoff position. The short-term may seem a little bleak, but the price of a quick patch isn't worth the long-term loss. Patience is a virtue here.

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Power Rankings: Red-hot Blue Jackets still fighting for respect

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Power Rankings: Red-hot Blue Jackets still fighting for respect

The Blue Jackets have been the most pleasant surprise in the NHL this season, but it's still going to take convincing for the hockey world to believe they're for real.

We’ll totally understand if you’re having just a little trouble getting on board with the 2016-17 version of the Columbus Blue Jackets. After all, you’ve probably been burned before.

Their fan base certainly seems to be wary. Despite the fact the Blue Jackets are the surprise of the NHL and have emerged as one of the most dynamic and exciting teams in the league, they drawn fewer than 12,000 in three of their past four home games. Even their coach thinks the team has work to do to earn their fans’ trust. “I want our team to have a chip on their shoulder,” Blue Jackets coach John Tortorella told Michael Arace of the Columbus Dispatch recently. “I think they should. We’re trying to get respect in the league. Quite honestly, we should be disrespected because of where we’ve been.”

That won’t last long if the Blue Jackets keep this up. The league’s best power play continues to fuel one of the league’s hottest teams and has landed them at the top of thn.com’s weekly Power Rankings for the second time this season. Last week’s rankings in parentheses:

CREAM OF THE CROP

1. Columbus Blue Jackets (8)

2. Philadelphia Flyers (15)

3. Pittsburgh Penguins (6)

4. St. Louis Blues (2)

5. Chicago Blackhawks (5)

6. Montreal Canadiens (7)

7. New York Rangers (4)

8. San Jose Sharks (11)

9. Boston Bruins (20)

10. Calgary Flames (27)

Is there a bigger bargain or a shrewder off-season signing than Sam Gagner?...Steve Mason went from one of the worst goalies in the NHL early in the season to one of the best of late. His save percentage in his first 16 games was .892, but has improved to .947 in his past five… If Marc-Andre Fleury wants to get traded, he’s not doing himself any favor with his play lately…The Blues completed a 4-0-1 home stand with the game going into overtime…With Jonathan Toews and Corey Crawford already out, the Blackhawks lost defenseman Brent Seabrook in their 4-0 win over Arizona Tuesday night…How will the Canadiens and the surprising Alexander Radulov respond to the injury to Alex Galchenyuk?...The injury-ravaged Rangers saw Rick Nash go down with a groin injury and Matt Puempel to a concussion in their 4-2 loss to the Islanders Tuesday night…Joe Thornton passed Brendan Shanahan for 25th all-time on the NHL’s scoring list with an assist in a 2-1 win over Montreal last week…Anyone who predicted David Pastrnak would be in Rocket Richard Trophy contention a third of the way into the season is looking very bright at the moment…The Flames were already one of the hottest teams in the NHL without Johnny Gaudreau, then won their first two with him back in the lineup.

THE MUSHY MIDDLE

11. Washington Capitals (11)

12. Edmonton Oilers (14)

13. Ottawa Senators (12)

14. Los Angeles Kings (1)

15. New Jersey Devils (23)

16. Detroit Red Wings (16)

17. Nashville Predators (3)

18. Minnesota Wild (19)

19. Anaheim Ducks (10)

20. Winnipeg Jets (17)

Capitals coach Barry Trotz had some pointed words to Alex Ovechkin about his penchant for taking minor penalties of late. No cracks in the foundation, though. Just a frank discussion…The Oilers game Tuesday night against Buffalo was touted as Connor McDavid vs. Jack Eichel, the kind of narrative the Oilers have learned to accept. “Every night it’s Connor vs. Somebody,” said Oilers coach Todd McLellan…Goalie Craig Anderson started in the Senators’ 8-5 loss to Pittsburgh Monday night, but did not travel with the team for a three-game California trip to be with his wife as she undergoes treatment for throat cancer…The usually stingy Kings have given up 11 goals in their past three games. “That’s too many goals,” said Kings coach Darryl Sutter…Devils winger Taylor Hall on the aftermath of his clean, but devastating, hit on Philip Larsen Tuesday night: “I feel terrible.” Not to be trite, but Hall should not be feeling terrible about the way he has played since returning from a knee injury. He has five points in his past two games…Goalie Jimmy Howard will be back in uniform for the Red Wings when they host Columbus Friday night, but will have a difficult time pushing Petr Mrazek out of the crease…After missing four games with an upper-body injury, James Neal scored a goal in a 4-3 Predators’ win over Colorado Tuesday night…Wild goalie Devan Dubnyk, whose career was revived when he came to Minnesota, will make his 300th career start tonight in Toronto…Anaheim coach Randy Carlyle could not pull Jonathan Bernier during his team’s 8-3 loss to Calgary because backup John Gibson was battling a stomach virus…Over the past 30 years, only Teemu Selanne and Alex Ovechkin have scored goals at a better pace than Patrik Laine of the Jets is scoring them now.

VYING FOR THE PARTICIPATION BADGE

21. New York Islanders (26)

22. Tampa Bay Lightning (22)

23. Carolina Hurricanes (25)

24. Buffalo Sabres (29)

25. Florida Panthers (24)

26. Vancouver Canucks (18)

27. Toronto Maple Leafs (13)

28. Dallas Stars (28)

29. Arizona Coyotes (21)

30. Colorado Avalanche (30)

With points in each of their past five games, four of them wins, the Islanders are easily on their most successful string of the season…The Lightning could get Ryan Callahan, Jason Garrison and Jonathan Drouin back for their home game against Vancouver Thursday night…Jordan Staal, sidelined for the past four games with a concussion, likely won’t be available to the Hurricanes for a three-game road trip through California that begins tonight…After playing almost 500 games in the minors, defenseman Erik Burgdoerfer made his NHL debut in the Sabres’ 3-2 overtime win over Washington Tuesday night… Panthers have gone to overtime in four of their five games GM Tom Rowe has been behind the bench. They’ve won one in overtime, lost two in OT and one in a shootout…Philip Larsen, who was taken off the ice on a stretcher after a hit from Taylor Hall Tuesday night, was released from hospital in New Jersey Wednesday morning and was cleared to return to Vancouver while the Canucks continue on a five-game road trip…After waiving Jhonas Enroth, the Maple Leafs search for a backup goalie continues. They signed Karri Ramo to a professional tryout contract and assigned him to their farm team. That should cure everything…The Coyotes have been outscored 14-6 and have averaged 41 shots against per game in an 0-3-1 month of December…All nine of Matt Duchene’s goals this season have come on the road. The Avs could use that kind of production at the Pepsi Center, where they’re 4-8-1 this season and recently went 0-4-1 on a five-game homestand.